One Day After Gupta Gets Two Years, Expert Consultant Cops Year-long Bid for Insider Trading

One day after corporate chieftain Rajat Gupta was sentenced to two years in prison after his conviction on insider trading charges, a different judge sentenced a former AT&T employee who pleaded guilty to sharing privileged information with investors to one year’s jail time.

Alnoor Ebrahim, who pleaded guilty in June to sharing sales information for AT&T handset devices, including the iPhone and Blackberry. Mr. Ebrahim, who was sentenced by Judge Paul J. Oetken, was paid more than $180,000 for his work with expert network Primary Global Research, which consisted of hundreds of calls with the firm’s clients.

While Mr. Ebrahim role at AT&T was as an “associate director of channel marketing,” according to a press release from U.S. Attorney Preet Bharara, Mr. Gupta is a former chief executive officer at consulting firm McKinsey & Co., charged by the government with passing information gained through his standing as a director on the board of Fortune 500 companies with hedge fund manager Raj Rajaratnam.

There are other notable differences. Mr. Gupta was convicted after a jury trial (though Judge Jed Rakoff, who presided over the case, said at Mr. Gupta’s sentencing hearing that he wouldn’t hold that fact against the defendant) and was found by the jury to have committed insider trading in a pair of isolated instances. He also had the benefit of a top-flight attorney in Gary P. Naftalis, who marshaled Mr. Gupta’s friends and acquaintances to mount a letter-writing campaign extolling Mr. Gupta’s good works.

Perhaps most important is that Mr. Gupta didn’t profit directly from insider trading, said Kevin O’Brien, a former U.S. Attorney and partner at NYC Harris, O’Brien, St. Laurent & Houghteling. “Gupta was such a weird case because he didn’t profit,” he told us. “If you’re doing it for money, you can be deterred by penalties. But if you’re doing it for status of prestige, it’s almost non-deterrable.”